All Forum Posts by: Account Closed

Hi Troy, Yes, you can get an individual loan however depending on your state's community property laws and the bank risk management process, they may require your wife to serve as guarantor on the loan. Reasoning could be based on the mortgage repayment ability of your salary or ensuring you don't transfer the asset to your wife as a protective mechanism (there could be more reasons why they'd want her as guarantor but those are some major reasons). You want to ensure that your income can solely cover the mortgage debt and any debt that you're solely responsible for. The bank will check your debt to income ratio, living expenses and your ability to repay all debts. Depending on whether this is an owner-occupied residence (like house hacking a duplex) or an investment property, they'll expect you to have a certain amount of liquid assets. Your wife can provide you with a cash gift for the downpayment/closing costs too. Let the bankers know what you're trying to do and they'll do the underwriting and will provide you with information about your Loan options. Hope this helps, Kay - banker in SoCal

Hey Jason,

I hope you're doing well! As a finance major in a finance industry, I read your post and thought "Who doesn't get excited about money!?" but everyone doesn't get excited about money right? SO what I would recommend is discuss with your spouse what gets them excited. What makes them happy, passionate, and glowing from the inside out. The joy of making money isn't for the sake of making money, but the ability to do the things you love with the money that is made! So find out what your spouse LOVES LOVES LOVES. If your spouse loves volunteering, explain how REI can increase your time and money to volunteer. If your spouse loves shopping, explain how REI can increase the time and money to shop. If your spouse loves to travel, explain how REI can provide the flexibility to travel. And then incorporate rewards/benchmarks for every time you make a successful REI and get them on board so not only are you working towards your goal but they're working towards theirs too...

example (they talked about this on BP) : Say your spouse LOVES LOVES LOVES taking vacations/traveling. So you tell your spouse how awesome REI is because it provides schedule flexibility and additional income. The more houses you get, the more cashflow you gain (or should =P) so everytime you close on a property, you two will take a trip. It's a quick way to get someone excited by incorporating their passions into yours.

Hope this helps! 

The easiest way to find a lender who will lend in multiple states is to find a bank that is in the states you're looking to purchase property in. So if you're looking to get funding for properties in Texas and Missouri, then use a bank that is located in Texas and Missouri such as Bank of America, Chase, US Bank, even midsize or community banks that in both states, and etc. The reason why I recommend banks that are in both states because the banks will be familiar with both markets and already have a presence in both markets. If you went to a smaller bank in Texas to refinance your property in KC, MO then they may be afraid of the market there because they have no exposure or understanding of the KCMO market. Banks want to minimize risk however and wherever they can so it'll be a little easier working with banks that are already involved in your stated RE markets. Usually large banks (Chase, BofA, US Bank, etc) will service loans in most states. hopes this helps!  

Hi Jessica, 

Congrats on your pregnancy! Your best option is to get an FHA loan which requires as little as 3.5% for an SFR or duplex. Although FHA is a government-assisted program for homebuyers, banks are still required to insure that the homebuyer meets certain requirements. A large chunk of those requirements is ensuring the purchaser has the ability to repay. This is based on a mixture of information:

1. Credit Score- does the borrower have a history of repayment? How much debt does the borrower have? 

2. Does the borrower have stable income (usually 6 months of current employment history and 3 years of tax returns) and how much is the monthly/annual income? Can the borrower's monthly income appropriately service the real estate debt AND their current (including student loans, credit cards, car, etc) AND their cost of living? 

3. Does the borrower have the cash/liquid assets to meet the required down payment on the property and cover the bank's closing costs which includes appraisal, tax search, flood search, underwriting, etc (this varies from bank to bank).

4. If you're looking to purchase a 2+ unit, then average rents in the area might be considered as income for the multi-unit property which can make it easier to meet the income requirement to service the mortgage. Keep in mind, not all financial institutions will consider the average rents for the area as income towards the property. 

If you're using your investment cash to live and do not currently have stable income, I suggest to wait until your cash reserves are replenished and you have at least 6 months of stable income (w-2 or 1099) to begin working with a lender. 

Best of luck to you and congrats again! 

FHA does have a program for 3-4 unit properties however they're subject to different rules than standard SFRs and not all lenders will conduct FHA lending for 3-4 unit properties. I recommend researching highly-rated FHA lenders (both mortgage companies and banks) in your area or contacting mortgage brokers because they usually can direct you to lenders who specialize in different types of mortgage lending. I'm learning that Quicken Loans doesn't usually offer the most favorable terms or rates. QL closing costs are extremely high and when I requested a breakdown of their $20k estimate, the sales associate told me that he cannot send me the breakdown until there is an accepted offer. I compared the QL closing costs to Bank of America (who has an awesome closing cost estimate calculator based on state), I learned that BofA is about $10K cheaper than Quicken Loans. Thats money I could be using to pay down principle or purchase another property!

I strongly recommend shopping around for MULTIPLE lenders. Every bank has different terms, rules, closing costs, down payment requirements, relationship practices, products, and etc.  This is one of the most important relationships that you will develop in the RE game, make sure you do your due diligence on your lenders. Happy Easter week and best of luck! 

Your work is beautiful!! You did a great job rehabbing the apartment. Did you use an agent to find your properties?

Welcome to Bigger Pockets! Little Rock is a great city!

Hello Josh, Welcome to BP!! You have a great goal list! I see you're interested in investing in mid-western states. Do have a particular state(s) in mind?

Hi Sara! Welcome to Bigger Pockets!!

Texas has high property taxes but they also don't have state income taxes. If I could invest anywhere, it'd be Austin TX or Fayetteville AR. I love southern college towns for rental properties and their cultures.